TPP: opportunities, not barriers

Details of the landmark Trans Pacific Partnership trade deal between 12 countries, including New Zealand, have been made public - reigniting the debate about the benefits or not of signing up to such undertaking.

Clearly, the deal is nowhere near completed and opponents will start to gather around the globe to stop the TPP in its infancy. Scrutiny from all nations will start in earnest.

The agreement will free up commerce in 40% of the world's economy but has been criticised for its opacity. If ratified, it will be a legacy defining achievement for United States President Barack Obama and his Administration.

Mr Obama joined the US to the TPP to counter China's growing economic and political influence. In turn, China responded with its own proposed 16 nation free trade area, including India, that would be the world's biggest such bloc, encompassing 3.4 billion.

Mr Obama faces the largest opposition to the TPP, although activists in New Zealand will do what they can to try to stop the deal.

The Labour Party has so far been vague on whether it will support the TPP but the growing sense is the party is starting to realise trade is the lifeblood of New Zealand's economy. Being a small nation at the bottom of the Pacific means New Zealand cannot be left out of any major trade deals.

The earliest the TPP will go before the US Congress is March, just as the US presidential primary season is heating up, creating the risk the deal will become an election issue. The TPP is opposed by American unions and many of Mr Obama's fellow Democrats, who are worried about the impact on jobs.

In New Zealand, the deal is being opposed mainly by university academics and left wing organisations concerned about the loss of sovereignty.

These opponents are not the ones with money on the line, trying to find overseas markets for home grown goods. They are also not the ones employing the very people who rely on exporters finding an extra order or two to continue paying wages and tax.

Trade union opponents are showing their lack of relevancy to members by opposing the deal. It is the union members and waged workers who will lose if New Zealand's export trade does not grow.

Without growing free trade, New Zealand exporters face ongoing high tariffs and the risk of being shut out of key markets. Claims the secrecy of the trade negotiations being undemocratic cannot be justified now about 6000 pages of negotiating documents have been released.

The risks are grossly overstated. For example, the investor state dispute settlement provisions in the TPP text are within the normal range of such provisions agreed in many other free trade agreements and are not a threat to New Zealand's sovereignty.

Countries which uphold the rule of law and uphold strong institutions do not get targeted with investor state dispute settlement provisions.

In the coming days, the Government will also release a legal summary of the agreement.

There is now time to pore over the details of the TPP, as other countries such as the Philippines and Indonesia will do now they have expressed interest in joining the pact.

Thailand is also considering joining, after studying the deal. This trade deal offers encouragement to small and medium enterprises which make up about 95% of New Zealand's economy. It is not just about big business.

New Zealand must not let this trade opportunity slip through its fingers.

The signs of a New Zealand European Union trade deal are encouraging, but that is unlikely to be signed off until 2019, and only after a wide ranging investigation.

Past trade deal negotiations have often foundered on the smallest of details. Now is not the time to prevaricate.

 

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